I believe you may have done some research on this topic. Perhaps you or someone else can answer my question.
I am looking at a paid workamping position and am concerned about the tax implications.
For example, if you are working in California for more than three months, I believe you are then considered a resident. Therefore, you would be required to declare all of your income to California and not just what you earned on your workcamping job there.
Does anyone know what other states have similiar tax implications?
I am ok with paying state taxes on what I earned in that particular state but not state taxes on all of my income.
That will give you a very detailed account of the issues. As for individual states, there is quite a variety of tax issues. That's why many workampers only take paying jobs in states with no state income tax.
As for states with state income tax, it usually comes down to residency and the wide variety of criteria that they use to determine if you are a resident, a part-year resident, or a non-resident. To work in those states requires careful research.
We happen to be taking a job in California next summer. The law is clear when it says you will not be considered a resident if your time in the state is "temporary or transitory", you have no intent to make California your residence (and you can prove that by your relationships with another state), and your length of time in the state is a definite period rather than indefinite.
Now with that said, the interpretation of "temporary or transitory" is very inconsistent. They do it on a case-by-case basis. It's clear if you are just a visitor and are in the state less than six months. However, if you are in the state for nine months of a year, you are "presumed" to be a resident and it gets more difficult to prove you are a non-resident.
It's not so clear if someone living and working in a paid position in the state for less than six months falls under the definition of "temporary or transitory".
We will be working four months and I have requested a ruling from the California Franchise Tax Board. They refuse to make a determination on residency based on the facts I provided. They just keep giving me links to the laws which I've already read, but no real information on how those laws are interpreted.
Other research I've done basically confirms the inconsistency in California's determinations. I've fully documented my requests for a ruling, and we are basing our final decision on the fact that we can certainly prove our stay in the state will be temporary, it is for a definite period under six months, we have no intent to be California residents, and all of our "significant contacts" are with another state. Also, the folks in the position prior to us were treated as non-residents.
I'm pretty confident in our decision. However, if we had significant income from retirement, pensions, etc. from our true residence state that could fall prey to an income tax state, I'd have to consider the possibilities even more thoroughly. I'd even go as far as to get a legal opinion from an attorney in the workamping state.
It's that whole "residency" thing that determines whether a state will try to tax all your income from all sources or only the income earned within the state. And it's a battle that you want to avoid. Just be very careful and do your homework.
Carstrom said
07:39 PM Nov 2, 2008
Howard, Thanks for the reply. After I made the post, I remembered that you made an extensive post on this topic. I will take a look at it again.
I believe you may have done some research on this topic. Perhaps you or someone else can answer my question.
I am looking at a paid workamping position and am concerned about the tax implications.
For example, if you are working in California for more than three months, I believe you are then considered a resident. Therefore, you would be required to declare all of your income to California and not just what you earned on your workcamping job there.Does anyone know what other states have similiar tax implications?
I am ok with paying state taxes on what I earned in that particular state but not state taxes on all of my income.
Thanks,
Connie
I'd recommend that you first carefully read through our Workamping Tax Implications page.
That will give you a very detailed account of the issues. As for individual states, there is quite a variety of tax issues. That's why many workampers only take paying jobs in states with no state income tax.
As for states with state income tax, it usually comes down to residency and the wide variety of criteria that they use to determine if you are a resident, a part-year resident, or a non-resident. To work in those states requires careful research.
We happen to be taking a job in California next summer. The law is clear when it says you will not be considered a resident if your time in the state is "temporary or transitory", you have no intent to make California your residence (and you can prove that by your relationships with another state), and your length of time in the state is a definite period rather than indefinite.
Now with that said, the interpretation of "temporary or transitory" is very inconsistent. They do it on a case-by-case basis. It's clear if you are just a visitor and are in the state less than six months. However, if you are in the state for nine months of a year, you are "presumed" to be a resident and it gets more difficult to prove you are a non-resident.
It's not so clear if someone living and working in a paid position in the state for less than six months falls under the definition of "temporary or transitory".
We will be working four months and I have requested a ruling from the California Franchise Tax Board. They refuse to make a determination on residency based on the facts I provided. They just keep giving me links to the laws which I've already read, but no real information on how those laws are interpreted.
Other research I've done basically confirms the inconsistency in California's determinations. I've fully documented my requests for a ruling, and we are basing our final decision on the fact that we can certainly prove our stay in the state will be temporary, it is for a definite period under six months, we have no intent to be California residents, and all of our "significant contacts" are with another state. Also, the folks in the position prior to us were treated as non-residents.
I'm pretty confident in our decision. However, if we had significant income from retirement, pensions, etc. from our true residence state that could fall prey to an income tax state, I'd have to consider the possibilities even more thoroughly. I'd even go as far as to get a legal opinion from an attorney in the workamping state.
It's that whole "residency" thing that determines whether a state will try to tax all your income from all sources or only the income earned within the state. And it's a battle that you want to avoid. Just be very careful and do your homework.
Thanks for the reply. After I made the post, I remembered that you made an extensive post on this topic. I will take a look at it again.
Connie